Mediation May HelpReduce Foreclosures
Washington-The Obama administration is doing everything in its power to reduce foreclosures through the Home Affordable Modification Program. While many are focusing on the refi and modification components of the plan, the Center for American Progress says that mandatory mediation should be incorporated into that process to make sure that the people who are eligible for these programs will in fact get the assistance that they need.
The report, "It's Time We Talked: Mandatory Mediation in the Foreclosure Process," outlines how foreclosures can be reduced by as much as 75% if the federal government takes a more direct role in providing opportunities for mediation.
Nine U.S. states now employ so-called alternative dispute resolution methods, and in particular mediation, to help at-risk homeowners deal with looming foreclosures by mortgage lenders or servicers.
Philadelphia and Connecticut have had mediation programs in place for a year now. About three-quarters of all cases that go through mediation are able to avoid foreclosure, according to Andrew Jakabovics, the organization's associate director for housing and economics.